Cyprus Mail: News Articles in English, 00-01-11

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From: The Cyprus Mail at <http://www.cynews.com/>

Tuesday, January 11, 2000

CONTENTS

[01] Market plunges amid panic selling by small players

[02] Opposition up in arms over article by Simitis adviser

[03] Papandreou arrives today for new round of talks

[04] Klerides hits out at VAT critics

[05] Cyprus grants flight permissions in new liberalisation move

[06] Government defends telecom liberalisation plans

[07] Government shuts down foundry until equipment fitted

[08] British close illegal boreholes

[09] Burglars run up sex line bill in children�s home raid

[10] Suspect�s father arrested in connection with bank raid

[11] Dig finds Neolithic Cypriots grew their own cereal

[01] Market plunges amid panic selling by small players

In a fall many market players expected, shares across the board took a beating as small investors dumped shares.

Unfazed by the panic selling, institutional investors sat it out.

Brokers said investors were disillusioned by a 6.9 per cent slump on the market last week and feared the correction could continue, while others said the �130 million IPO of co-op investment firm Demetra was also being used to further drain liquidity from the market.

"We are dealing with investors who have never experienced corrections on a wide scale. It is important in cases like this not to panic," said one trader.

There were mixed reactions on whether the drop would be short lived, but one stock exchange official said unspecified "corrective measures" were now expected from state officials.

"That is what happened in Greece," one official said, referring to state intervention which arrested a slide on the Athens bourse in late December. Volumes were at the relatively low �20.3 million on 3,626 trades, suggesting that it was only small investors who were bowing out and not institutional ones, one broker said.

It is the inexperienced investors who are selling and they shouldn't be," said CISCO broker Stavros Agrotis.

Agrotis said good financial results expected from many listed companies after a buoyant 1999 rendered the decline "totally irrational".

Accelerating a drop which started on weak sentiment last week, 62.45 points were razed from the all-share index, which closed at 601.58 points, a whisper above its intraday low of 598.25.

Tourism, commercial and investment shares were each hammered more than 12 per cent. Industrial stocks were off 9.46 per cent.

Higher losses to the general index were avoided after the heavyweight banking sector underperformed the rest of the market with a 7.6 per cent loss.

The market has suffered a liquidity crunch for the past month as new investment firms have amassed some one billion pounds in initial public offerings and private placements.

Some traders have said the market is also being affected by bearish signals put out by some influential brokerages. However they insisted that selling was premature.

"Many (investment) funds are following a wait-and-see strategy. Once one decides to start buying they will all get in together and the jump will be very sudden," said Christakis Christodoulou of Benchmark Securities.

"At the moment we are seeing investors, small investors, virtually selling off at very low prices."

Fatigue caused by the furore surrounding the government's plans to tax bourse gains and also a post-holiday depression added to the sour mood, he added.

Tuesday, January 11, 2000

[02] Opposition up in arms over article by Simitis adviser

OPPOSITION parties were up in arms yesterday over an article by an adviser to Greek Prime Minister Costas Simitis, which they claimed implied that Greece backed a confederation on the island.

In the wake of the hysteria whipped over the affair, the government, while trying to play down the controversy, said it would be seeking clarifications from Greek Foreign Minister George Papandreou when he arrived on the island today.

Trouble began on Sunday with the publication of the article by Giorgos Pandayias, press adviser to Simitis, in the Athens newspaper Eleftherotypia.

Pandayias wrote that any solution to the Cyprus problem should be based on equality and on a series of measures for rapprochement.

But some on the island are upset over the phraseology used by Pandayias, saying the implication is that a Cyprus solution be based on a confederation, the long-standing demand of the Turkish Cypriot side.

First to respond was Foreign Minster Yiannakis Cassoulides on Sunday, when he categorically stated that a confederation would never be accepted either the Greek or Cypriot governments.

Both socialist Edek and centre-right Diko were clearly upset by the article yesterday.

"I'm not at all satisfied by this article," said Edek leader Vassos Lyssarides. "There are a lot of things here which are unclear and when there are unclear points I don't believe the tone of an article can be positive."

A statement from Diko said the party was surprised. It went on to condemn the article as unacceptable, "wondering to what extent the opinions expressed were the same as the position of Simitis and the Greek government."

Disy leader Nicos Anastassiades said he hoped Pandayias was not suggesting a confederation. "Perhaps what he means is equality based on the human rights of all citizens," he said.

Government spokesman Michalis Papapetrou said yesterday that Nicosia had no indication of a change in the stance of the Greek government, but added that clarifications would be sought from Papandreou.

"Because of the article and the interpretation arising from it in the press, the issue is one that needs to be clarified," Papapetrou said.

Papapetrou declined to offer the government�s interpretation of the comments, but said he found it hard to believe that an adviser to the Greek Prime Minister would have meant "all those things he's been accused of, such as referring to a confederal solution."

"What stands is Athens and Nicosia's decision on a bizonal bicommunal federation," Papapetrou added.

In statements to the Cyprus News Agency (CNA), Pandayias said yesterday that his article had been misunderstood. He had not meant confederation. "The article does not overturn the previous decision by the Greek and Cyprus governments. Its goal was to contribute as much as possible to the development of a serious dialogue on Cyprus' EU prospects," he said.

Pandayias was backed by Greek government spokesman Demetris Reppas.

Reppas said yesterday the contents of the article were not different from the long-standing position of the Greek government on the Cyprus problem.

He said the Greek government's position favoured a bizonal bicommunal federation "and everything else said about the article has nothing to do with reality," Reppas added.

Tuesday, January 11, 2000

[03] Papandreou arrives today for new round of talks

Papandreou and Foreign Minister Yiannakis Cassoulides will hold talks this afternoon at the Foreign Ministry and give a news conference.

The Greek foreign minister will then meet House President Spyros Kyprianou.

Papandreou�s visit comes ahead of the second round of Cyprus settlement talks due to open in Geneva at the end of the month, and in the wake of the new impetus injected into the peace process by the EU�s Helsinki decision to offer candidate status to Turkey.

Tomorrow, Papandreou, son of the late Greek Premier Andreas Papandreou, will meet with President Glafcos Clerides at the Presidential Palace. He will also visit Archbishop Chrysostomos, Primate of the Orthodox Church in Cyprus.

Papandreou's packed schedule includes rounds of meetings with leaders of the political parties that are represented in the Parliament, and with political party youth organisations.

He will also confer with Attorney-general Alecos Markides, and give a speech at a Chamber of Commerce and Industry (KEVE) gathering on the latest political and economic developments.

The visiting Greek foreign minister concludes his visit to the island tomorrow evening.

Tuesday, January 11, 2000

[04] Klerides hits out at VAT critics

FINANCE Minister Takis Klerides yesterday hit out at parties threatening to scupper his VAT increase plans.

Opposition parties Akel, Edek and Diko have made plain their objections to Klerides' proposal that VAT go up from the current eight per cent to 10 per cent.

The Finance Minister said the VAT hike was necessary if Cyprus was to come into line with EU norms.

"All parties agree with EU accession, so how can some of them choose to be selective about which EU harmonisation measures they approve?" Klerides protested.

A bill raising VAT is due before the plenum soon, along with another increasing road tax. The �2.2 billion state budget is also due to run the gauntlet of a plenum in which the government does not enjoy a majority.

Akel has already made it clear it will not back the budget. Such a �no� vote would be unprecedented, even for an opposition party.

Faced with all this opposition, Klerides yesterday began what is expected to be an intensive few days of contacts with all parties, aimed at bringing them "on side".

The minister began his charm offensive by briefing the House Finance Committee yesterday morning.

Klerides insists the tax hikes are crucial if the state is to begin to cut down on the massive public deficit.

He told the committee that the government was ready to propose a series of measures aimed at reducing the tax burden on lower income groups.

He also said that as road tax demands were already being sent out for 2000, it was unlikely the increase in the levy, if and when approved, would apply from January 1 this year.

Klerides has already succeeded in getting increases in levies on fuel, four- wheel-drive vehicles and alcohol through the plenum.

The 2000 budget provides for only �1,366 million pouring into state coffers, and is thus an �872 million deficit budget.

Tuesday, January 11, 2000

[05] Cyprus grants flight permissions in new liberalisation move

CYPRUS yesterday granted permission to two airlines from the Gulf to operate flights out of Cyprus.

After a meeting of the Ministerial Committee for Air Transport, Communications and Works Minister Averoff Neophytou announced that Emirates Airlines and Gulf Air would in the near future operate flights from Cyprus.

The two airlines will cover destinations not operated by Cyprus Airways, and which the national carrier does not intend to operate in the future.

Neophytou said the decision was taken in the framework of the plan for gradual air liberalisation by 2003.

But he said that the committee had rejected an application for a second Israeli company to operate flights to Cyprus.

At the moment, Israel's national carrier El Al operates flights to Cyprus under a bilateral agreement with Cyprus Airways (CY). Tel Aviv is one of CY�s three most lucrative routes, along with London Heathrow and Athens.

The government is not yet ready to liberalise these three routes because CY insists it needs more time to work out a strategy to face full liberalisation.

Neophytou said the committee had also rejected applications from several British airlines wishing to operate flights to Cyprus.

Several charter firms from Greece have also had their applications put on hold for the moment, Neophytou said.

Last July, the government threatened to open the skies between Greece and Cyprus following a crippling strike by CY pilots.

It was reported at the time that four Greek charter firms had applied to Cyprus for permission to operate flights to the island.

But Neophytou said yesterday that the main goals at the moment were to offer better service to Cypriot travellers, to facilitate the survival of CY and to boost tourism and the economy.

The Minister also announced that three Cypriot companies had been given temporary operating licences. They are the Louis-owned Capital L, Helios and Aerotrans.

The three airlines are expected to start operation some time this year.

Tuesday, January 11, 2000

[06] Government defends telecom liberalisation plans

THE GOVERNMENT yesterday defended its plans to turn CyTA into a public company, saying its critics ought to understand the difference between liberalisation and privatisation.

Communications Minister Averoff Neophytou said yesterday that government- run CyTA (the Cyprus Telecommunications Authority) would face serious problems if it did not change the way it operated.

And he said that those who opposed plans to turn CyTA into a public company did not understand the difference between privatisation and the government- proposed liberalisation.

Neophytou said that, as it stood, CyTA was like a lion bound hand and foot by procedures.

"We believe that CyTA has to be liberalised to obtain the flexibility to be able to compete with the other telecommunication companies that will inevitably appear on the scene. CyTA is a lion, but procedures have bound him by his hands and feet."

Neophytou said liberalisation was the government's attempt to undo these ties: "We are against privatisation, but the government is open to and has the political will to discuss giving a part of the shares to CyTA employees."

And the minister categorically denied opposition claims that liberalisation was the first step towards privatisation: "I once again want to make a distinction between these two things. I believe that all the political parties, the deputies and everyone involved in the issue can easily understand this difference. Liberalisation of the market is different to privatisation. We never talked about privatisation, I would once again like to repeat and underline this."

He said Cyprus was one of the few countries that still had a government monopoly on telecommunications: "It is not something we should be proud of it is something we should be ashamed of."

But Akel parliamentary spokesman Andreas Christou yesterday said he saw no reason for CyTA�s current status to be changed.

"Our opinion is that CyTA can remain a public organisation, as an organisation of public interest, incorporating all the elements that will make it more competitive in the new environment."

Christou also said that CyTA should develop a broader framework of services in order to cultivate better relations with subscribers.

Diko deputy and president of the House Communications Committee Nicos Pittokopitis, meanwhile, took a stronger view saying that Neophytou and CyTA president Michalakis Zivanaris were "privatisation lovers."

"I will say something that will probably be misunderstood, butt I am forced by the circumstances to say it. The Communications Minister is a privatisation lover. The president of CyTA is likewise a lover of this policy and this financial philosophy."

He insisted that turning CyTA into a public company would eventually lead to privatisation, though he conceded that laws governing the operation of CyTA would have to change in order for the company to compete in the future.

Neophytou on Thursday announced plans for the formation of a regulatory board leading up to telecommunications liberalisation.

Tuesday, January 11, 2000

[07] Government shuts down foundry until equipment fitted

Government spokesman Michalis Papapetrou announced the decision during his daily briefing yesterday: "I would like to inform you of the framework of the legal solution the government is advocating. First of all, the operation of the foundry will be stopped for six months."

He said the government was prepared to discuss the issue of compensation to the owners, "for the loss they will suffer either from having to cancel existing orders or if they have to bring in products from overseas."

"During this time," Papapetrou said, "the foundry will be obliged to set up machines and special filters to lower the pollution to tolerable levels, and we mean levels lower than those required by the European Union."

He also said the government would be enlisting the services of overseas experts to examine the action being taken and to ensure that the problem had been overcome.

"In this framework and in the light of the current law which no one can overturn until it is cancelled or changed by the House of Representatives, the government is attempting to solve the problem."

Medical tests carried out on Ergates residents have shown the villagers had five times the cadmium and nearly three times the lead in their blood as do Nicosia residents.

The tests also uncovered cancer rates as much as three times the Cyprus average and concluded that 33 per cent of the children in Ergates suffered from chronic respiratory problems.

The Labour Ministry, under whose auspices industrial pollution falls, has already filed a suit against the foundry for exceeding the 300mg Cyprus emission standards � which itself is six times higher than the EU limit.

It has also sued the Nemitsas foundry in Zakaki on the same grounds.

Tuesday, January 11, 2000

[08] British close illegal boreholes

Farming organisations said the action could destroy farmers.

An announcement by the British Bases yesterday said, "The first phase of action to prevent the illegal abstraction of water from the Ormidhia aquifer began... Five illegal boreholes have been capped and their associated equipment has been removed for safekeeping."

The statement said that the Bases, "who own the land and who heavily rely on the precious water recourse, had to take the action in order to reserve dwindling stocks."

The Bases also said they had sent letters in Greek and English between April 1998 and June 1999, instructing "those who had committed trespass by drilling the boreholes" to dismantle their equipment, "but they failed to take any action."

Bases spokesman Rob Nee said: "We do not take such action lightly but were forced to do so by the unreasonable action of a few selfish people who saw fit to steal water and exacerbate the current shortages."

But farming organisations Pek, Eka, Agrotiki and Panagrotiki yesterday issued a joint statement saying they had called on Foreign Minister Yiannakis Cassoulides' to intervene on the matter.

The statement said they had sent a telegram to the Minister asking for the Bases' action to be stopped, and for farmers to be left to carry out their work uninterrupted.

"In a period during which agriculture receives blows from a continual drought, it is unheard of that boreholes be closed at a time when cultivated plantations have immediate need for water, leading the affected farmers straight to destruction."

The Bases began their operation at 6am yesterday. About 100 potato farmers in the Ormidhia and Xylotymbou area are affected. Farmers said Bases personnel told them they would in the near future be capping a further 23 boreholes.

Tuesday, January 11, 2000

[09] Burglars run up sex line bill in children�s home raid

The burglars made off with the many of the house's appliances and other goods, but they really left their mark with a �1,200 phone bill.

The manager of the holiday home, Neophytos Rodas, told Ant1 television last night that, "It seems that they brought their own telephone, which they connected to the plug on the fax, and so the account was charged on the fax account rather than on the regular phone."

The house in the mountain holiday village was empty when the burglary took place.

Platres community leader Costas Kyriakides said hundreds of houses were left uninhibited in Platres during the winter months. "We only have six or seven policemen, how much can they do?" he said.

[10] Suspect�s father arrested in connection with bank raid

After arrest of Demetris Tantis and his mother in connection to last week's raid on a Limassol bank came the arrest of Tantis' father yesterday.

Limassol police last night told the Cyprus Mail that 48-year-old told Minas Tantis had been arrested in Limassol late in the afternoon on suspicion of receiving money stolen in last week�s heist and possibly in an October raid at the same bank.

Tantis, who joins son Demetris and ex-wife Chrysanthi in custody, is expected to be remanded today.

One other person, 28-year-old Pontian Greek George Yiannides, has been remanded in connection with Wednesday's �22,000 raid on the main Limassol branch of the Popular Bank.

Police are convinced the raid was carried out by the same robbers who got way with some �60,000 after a hold-up at the same bank on October 13 1999. Last week�s robbers told customers: "Good morning and Happy New Year, we're back again."

Tuesday, January 11, 2000

[11] Dig finds Neolithic Cypriots grew their own cereal

A French mission excavating at the Pareklishia-Shillourokambos Neolithic site under the direction of Professor Jean Guilaine has unearthed evidence suggesting Cypriots domesticated wild crops in the eighth millennium B.C.

The crucial evidence was found while investigating the remains of circular earth and stone huts that made up the Neolithic settlement, in the Limassol area.

"Impressions of cultivated species of wheat and barley were identified in the upper layers; in the lower layers, however, species of cereals still in their wild form were found," an Antiquities Department statement read yesterday.

"This is an extremely important finding as it establishes that domestication took place in Cyprus independently of the Near East," the statement adds.

The dig also yielded new skeletal material thought to belong to a human population that lived on the island between nine and ten thousand years ago.

Animal bones, such as deer antlers and pigs' skulls, were found near the human remains, probably deposited as offerings to the dead.

The discovery of the remnants of meals (bones of domesticated animals and deer) indicated the huts were used for domestic purposes. Querns, pounders, stone tools and vessels were also found. Rarer objects, such as a small female anthropomorphic figure an inch high were also unearthed.

Archaeologists also found a well on the site.

© Copyright Cyprus Mail 2000

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